Meta Platforms Inc (NASDAQ:META) is currently facing allegations from the U.S. Federal Trade Commission (FTC) over the withholding of crucial information during the acquisitions of Instagram and WhatsApp. This recent development has brought the social media conglomerate, led by Mark Zuckerberg, under scrutiny, with the FTC pushing for the company to be dismantled.
The FTC claims that Meta did not provide all the necessary information during the original reviews of the Instagram and WhatsApp acquisitions. According to the court filing, the agency now has access to additional pre-acquisition documents that were not disclosed by Meta in 2012 and 2014. This has led to criticisms of the FTC’s approval of these transactions, ultimately resulting in a lawsuit in 2020 accusing Meta of monopolizing the social networking market by eliminating emerging competitors.
Meta, on the other hand, is seeking to have the case dismissed before it goes to trial, arguing that its investments in Instagram and WhatsApp have benefited consumers. While Meta highlights the significant revenue generated by Instagram, the FTC alleges that Meta has increased advertising on Instagram and neglected to innovate and enhance the app’s features.
This is not the first time Meta has faced accusations of withholding information, as European antitrust regulators fined the company in 2017 for providing misleading details about the WhatsApp acquisition. Despite these challenges, Meta’s stock has shown impressive gains over the past year.
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In conclusion, the ongoing legal battle between Meta and the FTC underscores the complexities surrounding large-scale acquisitions and the scrutiny faced by tech giants in the current regulatory landscape.